[Laura]

Hi! I’m curious about those who retire before Medicare eligibility age, how do you have health insurance?

How much do you pay monthly? what options do I have?

While I am working towards a FATFIRE number, on track in the next 5-8 years.

I haven’t taken account for health insurance.

I’m seeking advice on how early retirees manage their health insurance needs.

For those of you who retired before the age of 65, how did you secure health insurance coverage?

What options did you find most effective, and what are the typical monthly costs involved?

Any insights on navigating the healthcare system during early retirement would be greatly appreciated.

Thank you!”

[Stephanie]

Healthcare(dot)gov/see-plans
You can go to the link above and put in your age when you plan to retire and see how much you’d pay for this year’s healthcare plans.

You don’t have to sign up to use that link, just asks some basic questions and you’d get some options.

Not sure what the options will be in 5-8 years but it gives you an idea.

[Golden]

ACA marketplace. I’ve been self employed my whole career. Never had employer insurance.

If your income is under threshold, you’ll receive subsidies.

It’s a lot more affordable than you think.

[Linda]

I am 46. I wonder if politicians are going to get “smarter” and change ACA to use assets versus income for cost and subsidies of plans.

[Christine]

I work part time and use Marketpkace. You have to have some income over the poverty level (which varies by state) in order to qualify.

Otherwise you’re on Medicaid.

That’s the reason I work part time is because of health insurance I’m only 64 in September.

I figure once I go on Medicare since I’m gonna do supplemental I’ll probably still end up paying $400 -$500 a month for coverage.

[Christopher]

I did COBRA the first half-year to preserve benefits and deductible stuff.

After that, ACA.

If you can control your income, you can manage your ACA costs to be wherever you want.

Our high-income rebalance year had no subsidy, so we paid a ton.

Subsequent years have been heavily subsidized.

[Rick]

Travel health insurance is very inexpensive (not to be confused with travel insurance) but this is mostly because you pay out for pocket for routine care and the insurance is more for catastrophic care.

Which is where US based health insurance should and hopefully will go in the future.

But even paying out of pocket for many things, the total annual cost is still very very inexpensive.

These costs are going to be far more consistent than options below as there are not many factors that change prices.

Outside of that, since it does require mostly non US travel throughout the year, ACA or one working spouse employer health plan or previous employer retiree health plans are what I expect covers the vast majority of RE people.

The costs of these will vary a ton by how much other people (taxpayers or employer or employee teammates) are paying for your health coverage.

So I am not sure any cost someone shares will be all that helpful.

[David]

I’m dual covered for healthcare. I have VA that covers everything for free. Plus I pay $60 a month for TriCare to be fully covered for a family.

Another huge FIRE hack for military folks.

This allows my $100K in passive income to be used on lavish stuff being retired early.

[Regina]

I answered in thread but will reiterate here – plan selection is very important.

The ACA and premium tax credits you can get (which I think it’s arguable how much you’d get if you’re aiming for fat FIRE unless you’ve been able to do multiple Roth conversions etc – you’re more concerned with AGI in this case vs tax burden).

As dividends, interest and distributions from tax sheltered accounts generally all up your AGI, even if you don’t see taxes on LTCG, this can be a doozy for people in the higher retirement budgets.

Anyway, my PTC puts me at about $400 (last year it was more like $800 with some higher income) a month for two on an ACA plan.

We pay $900 because income is variable and I don’t want to owe next year (plus I can use the premium to continue credit card hacking).

HOWEVER – this is a high deductible plan.

On top of the $5k or so in premiums, our individual deductibles are over 3k – AND for some reason I researched of forgot, it doesn’t count for an HSA despite the deductible being technically high enough to be a HDHP.

We had something like 14k in healthcare spending last year due to a surgery and a medical emergency.

Fast forward to this year – while medical utilization has been low, we need to change around some of the prescription drugs and are finding that even tier two, in network, is $500-$900 a month, for one drug.

Just needing a specific drug could up annual health care spend by nearly $11k.

At this point, nearly 25% of my budget goes to healthcare spending, easy.

Perhaps more, but then max out of pocket would kick in eventually for drugs +surgery.

It’s now looking like it might be worth seeing if we can qualify for my states new highest Medicaid tier, though it might mean getting more creative in moving money from brokerages to IRAs until I have less earned income and can do some Roth conversions later.

[Golden]

You can get $0/month for family, with subsidies. $18,000 deductible.

[Anita]

ACA although depending on who is in power in the next 4 years, it’s not a sure thing.

[Su]

You live abroad and you don’t get us healthcare.
In most of the world you pay much less even without insurance than the copay would be here.

If I was retired and living abroad was realistic family wise, I would get out of the US.

There are so many scenarios here (many forms of insurance, cost of living, old age care, child care, high cost of services) that make your FI number much larger that it needs to be.

[Jolene]

Farm Bureau HDHP. $472 total per month for two adults age ~50. Must go through medical underwriting if over age 40.

Nationwide coverage through UMR and 60% coverage overseas.

Only available in some states like Tennessee, Kansas, South Dakota, etc.

[Susan]

I use marketplace and it costs me close to $500 a month with a $7500 deductible.

It’s not cheap and am counting the days till am on Medicare

[Rebecca]

I used a broker and told him what I needed. I’m very healthy but now have a bulging disc and so far all the co pays have been reasonable

[Eric]

I use marketplace. Once i fired my income dropped drastically and I qualified for a very good plan.

I pay $70 a month for a silver plan no deductible.

[Alicia]

Even with no subsidy, I paid less last year for a platinum ACA plan than I would have paid for COBRA.

And the ACA plan had no deductible, very low copays, and a $3000 out of pocket max.

And all my doctors were on the plan.

I never had coverage that great from my workplace.

[TB]

Hubby and I are both retired before Medicare age and get 100% subsidized ACA health insurance from United Healthcare so no janky plan.

We’ve used it for a few years and have been satisfied with the coverage for two injury incidents.

If your income is from investments and in the right range, it’s a shockingly good deal in my state!

[Bobby]

We’re rounding out year three in RE. We use the ACA – Obama Care. The first two years we lived off of cash and technically had very little taxable income AGI (which is what ACA subsidies are based on).

So we paid nothing in health care.

Now we’re being more strategic about our withdrawals and conversions so this year, for a family of 3, our income will show around $120k in taxable income and we’re paying $850 for a Gold plan and $50 for dental monthly.

I hope that helps out.

The ACA has a great calculator you can use to test different assumptions.

We also use the “attestation of income” form as it’s the easiest way to report income in RE, in our opinion.

[Author]

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